Ex-Sun Reporter Pleads Not Guilty

LONDON—The former chief reporter for
News Corp
.
's U.K. tabloid the Sun pleaded not guilty at London's central criminal court Friday to a charge of conspiracy to commit misconduct in public office.

Separately, a public official the court said couldn't be publicly named pleaded guilty to a charge of conspiracy to commit misconduct in public office.

ENLARGE

John Kay, the Sun's former chief reporter, arrives at the Old Bailey courthouse for a hearing in London, Friday.
Reuters

Both charges sprang from Operation Elveden, a police investigation into allegations that journalists were bribing public officials for information. The investigation is part of a wider police probe into alleged illegal reporting tactics at News Corp.'s U.K. newspapers. News Corp. has said it is cooperating with the police investigations.

British prosecutors in November said the conspiracy charge against the Sun's former chief reporter,
John Kay,
related to £100,000 ($150,140) in bribes allegedly paid by the Sun to a Defense Ministry official in exchange for information that "formed the basis of a series of news stories."

Separately, News Corp. revealed Friday that the publishing company it plans to spin out won't have to cover the costs of any civil settlements tied to the scandal over the illegal interception of voice-mail messages by journalists at its U.K. newspapers. In a filing with the U.S. Securities and Exchange Commission, News Corp. said the publishing company will be indemnified by its former parent for any payments made after the spinoff that arise from civil claims and investigations relating to the phone-hacking scandal. The filing noted that the publishing company won't be indemnified for any criminal fines or penalties flowing out of the scandal.

Between July 1, 2010, and the end of last year, News Corp. "incurred legal and professional fees" relating to the phone-hacking scandal and related matters totaling $250 million, while $25 million has been paid in civil settlements. It has set aside another $70 million, which the company indicated was its "best estimate of the liability for the claims that have been filed."

The publishing company being spun out will own all of News Corp.'s newspapers, including its British and Australian titles as well as Dow Jones & Co., publisher of The Wall Street Journal, some Australian television assets and book publishing. It will retain the News Corp. name while the much bigger company holding the entertainment operations will be called Fox Group.

The filing also made clear that the publishing company will emerge with a strong balance sheet. The company is expected to have a cash balance of about $2.6 billion after its spinoff, with no debt.

Meanwhile Friday, two former top executives of News Corp.'s U.K. newspaper unit appeared in London's central criminal court on two separate matters, but their cases were adjourned to a later date. The court placed a number of restrictions on what the media was allowed to report about these cases.

The executives are
Rebekah Brooks,
former editor of the Sun who later rose to lead News Corp.'s U.K. newspaper unit, and
Andy Coulson,
a former editor of the News of the World tabloid who later served as Prime Minister
David Cameron
's
top communications adviser until he resigned that post in 2011. In November, both were charged with conspiracy to commit misconduct in public office, in relation to separate alleged payments to public officials in exchange for information. Mr. Coulson at the time denied the charges. A representative for Ms. Brooks didn't comment.

Separately, the Associated Press reported that a former police officer and a prison officer on Friday admitted selling information to the Sun. The AP said both men pleaded guilty to misconduct in public office. A spokeswoman for News Corp.'s U.K. newspaper unit declined to comment.

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